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Minimum car insurance coverage

You'll have just enough coverage to get on the road — but is it enough protection?

Most states require you to buy minimum car insurance coverage with at least liability protection on your policy, and sticking to this minimal coverage can save you money. However, consider that you’ll pay out of pocket for accident damage to your own car. Since most states only require a low level of coverage, it’s likely that you’ll pay out of your own pocket for an auto accident that exceeds the limits of your coverage.

What is the minimum car insurance coverage?

Minimum coverage is the lowest amount of car insurance coverage that you can buy before getting on the road. Most states require at least liability coverage to drive a car, but some states also require other types of coverage like:

  • Property damage liability. Covers damage to someone else’s car if you cause the accident.
  • Bodily injury liability. Pays for medical bills and legal fees if you cause injuries to other drivers, passengers or pedestrians.
  • Personal injury protection (PIP). Helps you recover medical costs from injuries after a car accident. It can also include reimbursement for lost income, childcare expenses and house care if you can’t take care of those responsibilities.
  • Uninsured or underinsured motorist. Makes sure you don’t pay out of pocket when the at-fault driver doesn’t have insurance to pay for your car’s repairs or medical bills.

Minimum car insurance coverage in action

In California, you’re required to have at least 15/30/5 liability coverage. That means you need:

  • $15,000 of coverage for bodily injury per person in an accident
  • $30,000 of coverage for bodily injury per accident
  • $5,000 of coverage for property damage per accident

Minimum coverage will insure you up to those limits. But if your car is damaged in an accident you cause, you’ll have to pay out of pocket for your car repairs and hospital bills.

Who should consider minimum coverage car insurance?

If you don’t have the means to buy more comprehensive auto insurance, minimum coverage can insure you just enough for you to get on the road.

Minimum coverage insures you against expenses for bodily injury and property damage. However, it won’t pay for expenses from other damages, such as repairs to your own car (you’ll need collision coverage for that). Keep in mind that the cheaper your car insurance, the less coverage it probably offers.

Drivers who might need minimum coverage only might find themselves in these situations:

  • Your car’s not worth much.
  • You’re planning to buy another car soon anyway.
  • You can afford to pay for damages out of pocket.
  • You can afford to go without a car if it was totaled.
  • You have great health insurance.
  • You’re on a budget or fixed income.

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How much does minimum coverage cost?

Minimum liability car insurance is the cheapest type of policy. It can cost around $600 to more than $1,000 a year. The cost of minimum coverage will vary depending on your age, where you live and your driving history, among other factors.

Does it come with a deductible?

Minimum liability coverage usually doesn’t come with a deductible. For example, if you hit another car and your insurance covers the cost of the other driver’s repairs, you won’t have to pay out of your pocket.

The deductible is what you’ll pay before your insurance company will pay a claim.

Let’s say you file a claim to your insurance company for a $5,000 car repair bill. Your insurance covers you for that amount, but it includes a $500 deductible. This means you must pay $500 out of your own pocket before your insurance will cover the other $4,500.

How to buy minimum car insurance coverage

  1. Shop around to get quotes and compare insurers.
  2. Start an online quote with your chosen provider.
  3. Usually online quotes default to your state’s minimum insurance levels.
  4. Decline any extras or higher maximums.
  5. Complete your purchase and print out ID cards or wait for them to arrive in the mail.

Bottom line

Minimum coverage will get you on the road quickly. However, you may want to buy more coverage to protect yourself and meet your state minimum requirements for car insurance.

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